Add shipping trade practices Bill to existing law: regulator

Add shipping trade practices Bill to existing law: regulator

Bangalore: In a move aimed at forging consensus and saving time, maritime regulator director general of shipping (DGS) has suggested the long-pending Shipping Trade Practices Bill be included as a new chapter in an existing law.

India is seeking to bring accountability and transparency in the working of service providers in the maritime transportation logistics chain for shipping cargo by framing a shipping trade practices Act. That has been delayed due to strong lobbying by service providers who want it scrapped. 

The regulator’s suggestion to include it in the Multi-modal Transportation of Goods Act, 1993, is seen as a bid for the consensus among stakeholders and help the new government frame the law the earliest.

The suggestion was made by DGS Lakshmi Venkatachalam at the first meeting of a working group set up by the Union shipping ministry to review and revise the draft Shipping Trade Practices Bill prepared almost five years ago. The minutes of the 29 April meeting of the DGS-headed working group were reviewed by Mint.

Apart from recommending a revised draft of the Bill, the group has to make suggestions to amend the Multi-modal Transportation of Goods Act.

However, the Federation of Freight Forwarders Association of India and the Western India Shippers Association, two groups strongly supporting the enactment of the Shipping Trade Practices Bill, say it cannot be combined with the multi-modal transportation Act, according to two officials at these groups.

The Bill aims at more transparency in container freight charges to promote competition and lower costs without actually regulating prices, a ministry official said. Logistics costs account for 13-15% of GDP in India, compared with 8-9% in developed countries.

India ships some 7.8 million cargo containers a year.

The existing draft says service providers will have to be registered in India to be able to do business in the country. They will also have to display their fees—including a breakdown of costs—either on their premises or websites.

“The charges levied by these service providers in the maritime transportation logistics chain are often arbitrary," said an official at trade lobby group Federation of Indian Export Organizations. But service providers are opposing the move.

“Considering the unpredictability/dynamism of markets and other factors, price publication is not feasible," an official at the Indian National Shipowners’ Association said.